SEC Division of Investment Management staff letter: Tri-Continental Corporation — SEC — US

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Tri-Continental Corporation

March 25, 2003

Responses of the Office of Disclosure and Review Division of Investment Management

File No. 811-0266 Tri-Continental Corporation

Letter 1

Donald R. Crawshaw, Esquire Sullivan & Cromwell LLP 125 Broad Street New York, New York 10004-2498

Re:

Tri-Continental Corporation File Number 811-0266 Shareholder Proposal of Mr. Robert P. Laukat and Ms. Rosalind J. Schulman

Dear Mr. Crawshaw:

By letter dated January 28, 2003, you notified the Securities and Exchange Commission of the intent of the Tri-Continental Corporation to exclude from its 2003 proxy soliciting materials a shareholder proposal and supporting statement submitted by Robert P. Laukat and Rosalind J. Schulman by letter dated October 8, 2002. Their proposal states:

RESOLVED: that the shareholders of Tri-Continental Corporation assembled in annual meeting in person and by proxy, propose that the Board of Directors change the By-Laws of the Corporation to require that a majority of the Directors not be a Board member of any other Seligman fund or be otherwise associated with J. & W. Seligman and Company.

You requested our assurance that we would not recommend enforcement action to the Commission if Tri-Continental excludes the proposal in reliance upon subparagraphs (i)(3), (6) and (8) of Rule 14a-8 under the Securities Exchange Act of 1934.

Subparagraph (i)(6) of Rule 14a-8 provides that a company may exclude a proposal if the company would lack the power or authority to implement the proposal. You argue that neither Tri-Continental nor its board of directors has the power or authority to guarantee or enforce the election of any particular person or type of person as director; rather, the power to elect directors of Tri-Continental resides solely in the company's stockholders.

There appears to be some basis for your view that the proposal may be omitted from Tri-Continental's proxy materials under Rule 14a-8(i)(6). See , e.g. , Farmer Bros. Co. (pub. avail. Oct. 15, 2002) (proposal to amend bylaws to require that majority of board of directors be independent and that board committees be comprised entirely of independent directors), General Electric Co. (pub. avail. Feb. 4, 2002) (proposal requiring that majority of directors be independent), Mattel, Inc. (pub. avail. March 21, 2001) (proposal to amend bylaws to require that all directors on key board committees meet independence requirements), Marriott International, Inc. (pub. avail. Feb. 26, 2001) (proposal that board of directors adopt policy requiring two-thirds of directors be independent and that certain board committees be entirely composed of independent directors); compare

with Murphy Oil Corp. (pub. avail. March 10, 2002) (staff refused no-action relief where proposal that board adopt a policy that all members of executive, compensation and nominating committees be independent, but board excused if board does not contain necessary number of independent directors required to constitute committee); Duke Realty Corp. (pub. avail. Feb. 7, 2002) (staff refused no-action relief for proposal that board adopt goal of having board at least two-thirds composed of independent directors and that board pursue this goal through its power to nominate candidates for election). Accordingly, we will not recommend enforcement action to the Commission if Tri-Continental excludes the proposal from its proxy materials in reliance on Rule 14a-8(i)(6). In reaching this position, we have not found it necessary to address the alternative bases for omission that you raise in your letter.

Mr. Laukat and Ms. Schulman subsequently submitted a revised proposal to Tri-Continental by letter dated February 5, 2003. The second proposal states:

RESOLVED, that the shareholders of Tri-Continental Corporation, assembled in person and by proxy, propose that the By-Laws of the Corporation be changed to require that at the earliest practicable time a majority of the Directors shall not be affiliated with J & W Seligman and Company, and said proposal shall be accomplished by nominating persons at succeeding annual meetings who meet this requirement.

By letter dated February 14, 2003, you wrote requesting no-action relief if Tri-Continental omits the second proposal based on your view that the second proposal is actually a different and new proposal, which may be excluded pursuant to Rule 14a-8(c) (shareholder may submit no more than one proposal for a particular shareholders' meeting) and Rule 14a-8(e) (proposal submitted after the applicable deadline may be omitted). Alternatively, you argued that should the staff view the second proposal as merely a revision to the first proposal, Tri-Continental elects to not address the second proposal in reliance upon Staff Legal Bulletin No. 14.

There appears to be some basis for your view that the second proposal may be viewed as a new and different proposal, and as such, may be excluded pursuant to Rules 14a-8(c) and 14a-8(e). Accordingly, we will not recommend enforcement action to the Commission if Tri-Continental excludes the second proposal from its proxy materials.

Attached is a description of the informal procedures the Division follows in responding to shareholder proposals. If you have any questions or comments concerning this matter, please call me at (202) 942-0638.

Yours very truly,

Linda B. Stirling Senior Counsel Office of Disclosure and Review

cc: Robert P. Laukat Rosalind J. Schulman

Letter 2

March 25, 2003

Donald R. Crawshaw, Esquire Sullivan & Cromwell LLP 125 Broad Street New York, New York 10004-2498

Re:

Tri-Continental Corporation File Number 811-0266 Shareholder Proposals of Ms. Betty Rowe Wilson

Dear Mr. Crawshaw:

By letter dated January 28, 2003, you notified the Securities and Exchange Commission of the intent of the Tri-Continental Corporation to exclude from its 2003 proxy soliciting materials a shareholder proposal and supporting statement submitted by Betty Rowe Wilson (the "Proponent") during the week of December 16, 2002. Her proposal states:

Tri-Continental Corporation is known as a "closed-end" mutual fund. In recent years it has become "open-ended" in the sense that it has been buying its own stock in the open market. I propose an end to this activity. Please vote in favor of this proposal, if you agree the corporation should return to a true "closed-end" status.

You requested our assurance that we would not recommend enforcement action to the Commission if Tri-Continental excludes the proposal in reliance upon subparagraphs (i)(1) and (3) of Rule 14a-8 under the Securities Exchange Act of 1934.

Omission of the Proposal Based on Rule 14a-8(i)(1)

Subparagraph (i)(1) of Rule 14a-8 provides that a company may exclude a shareholder proposal if the proposal is "not a proper subject for action by shareholders under the laws of the jurisdiction of the company's organization." You argue that, because it neither requests nor recommends, but instead directs the board to take action, the proposal is contrary to the laws of the state of Maryland, the state in which Tri-Continental is incorporated.

There appears to be some basis for your view that the proposal may be omitted pursuant to Rule 14a-8(i)(1) as an improper subject for shareholder action under state law. It appears, however, that this defect could be cured if the proposal is recast as a recommendation or a request to the board of directors. See , e.g. , Archer-Daniels-Midland Co. (pub. avail. July 10, 1998). Unless the Proponent provides Tri-Continental with a proposal revised in this manner within seven calendar days after receiving this letter, the Division will not recommend enforcement action to the Commission if Tri-Continental omits the proposal from its proxy materials under Rule 14a-8(i)(1).

Omission of the Proposal Based on Rule 14a-8(i)(3)

Subparagraph (i)(3) of Rule 14a-8 provides that a company may exclude a proposal if the proposal is contrary to any of the Commission's proxy rules, including Rule 14a-9, which prohibits false and misleading statements in proxy materials.

You contend that the proposal is so confusingly worded that it is unclear what is actually being proposed. Among the misstatements you claim that the proposal contains are (1) that the Corporation is a mutual fund, (2) the Corporation has "open-ended," and (3) the implication that share repurchases determines whether a fund is open- or closed-ended. You argue further that the proposal misleads the reader as to its subject and the effect it will have on the Corporation.

There appears to be some basis for your view that certain portions of the proposal may be misleading, yet we are unable to concur that it is unclear what is actually being proposed. The defects in the proposal could be cured if the proposal is recast to remove the term "mutual" from the first sentence, and the language "return to a true `closed-end' status" found in the last sentence is revised to state "no longer repurchase its own stock." See Staff Legal Bulletin No. 14. Accordingly, unless the Proponent provides Tri-Continental with a proposal revised in this manner within seven calendar days after receiving this letter, the Division will not recommend enforcement action to the Commission if Tri-Continental omits the proposal from its proxy materials in reliance on Rule 14a-8(i)(3).

Omission of the Supporting Statement Based Upon Rule 14a-8(i)(3)

You assert that because the Proponent's supporting statement is replete with false or misleading statements, Tri-Continental may omit the entire supporting statement pursuant to Rule 14a-8(i)(3). This rule permits a company to exclude a proposal that violates any of the Commission's proxy rules, including Rule 14a-9, which prohibits materially false and misleading statements in proxy soliciting materials.

We are unable to concur with your view that Tri-Continental may omit the entire supporting statement under Rule 14a-8(i)(3). Although there may be some basis for your belief that portions of the supporting statement may violate Rule 14a-9, we believe that the Proponent may cure the potential violations by amending her supporting statement. In our view, the Proponent should:

Revise the fourth sentence to remove the implication that repurchased shares are held as investments.

Provide the date and source of information for the net asset value and market price figures found in the fifth, sixth and seventh sentences.

Accordingly, unless the Proponent provides Tri-Continental with a supporting statement revised in this manner within seven calendar days after receiving this letter, we will not recommend enforcement action to the Commission if Tri-Continental omits only these portions of the Proponent's supporting statement from its proxy materials in reliance on Rule 14a-8(i)(3).

Omission of the Second Proposal

The Proponent subsequently submitted a revised proposal to Tri-Continental by letter dated February 7, 2003. The cover letter to the proposal states that the Proponent is withdrawing the first proposal and replacing it with a "new, almost completely revised" second proposal, which states:

Tri-Continental Corporation defines itself as a diversified, closed-end management investment company incorporated in the State of Maryland. "Barron's Financial Weekly" publication classifies it as a "closed-end mutual fund." In recent years, it has become "open-ended", in the sense that it has been buying its own stock, both from Stockholders and in the open market. I propose an end to this activity. Please vote in favor of this proposal, if you agree the corporation should return to a true "closed-end" status.

You write that since the second proposal is substantially identical to the first proposal -- and not, in fact a "new proposal" -- you assume that the Proponent's true intention, notwithstanding her statement of withdrawal, is to revise the first proposal and supporting statement. * You then state that Tri-Continental has elected, in reliance upon Staff Legal Bulletin No. 14, not to address the second proposal. Instead, Tri-Continental reaffirms its request that the staff confirm that it will not recommend any enforcement action if Tri-Continental omits the first proposal and supporting statement from its proxy statement under subparagraphs (i)(1) and (3) of Rule 14a-8.

There appears to be some basis for your view that the second proposal may be treated as a revision under Staff Legal Bulletin No. 14. Moreover, we concur in your view that were the second proposal, in fact, a "new proposal," it would properly be excluded pursuant to Rule 14a-8(e), which provides that a proposal submitted after the applicable deadline may be excluded. Accordingly, we will not recommend enforcement action to the Commission if Tri-Continental excludes the second proposal from its proxy materials.

Yours very truly,

Linda B. Stirling Senior Counsel Office of Disclosure and Review

cc: Betty Rowe Wilson

Indeed, a February 25, 2003, letter from Ms. Wilson to the staff confirmed that the second proposal was made to "correct" her initial proposal in response to the arguments contained in Tri-Continental's January 28, 2003, no-action request. Ms. Wilson also requested that her first proposal be considered if her second proposal is deemed untimely.

Letter 3

March 25, 2003

Donald R. Crawshaw, Esquire Sullivan & Cromwell LLP 125 Broad Street New York, New York 10004-2498

Re:

Tri-Continental Corporation File Number 811-0266 Shareholder Proposal of Mr. Robert G. Wilson

Dear Mr. Crawshaw:

By letter dated January 28, 2003, you notified the Securities and Exchange Commission of the intent of the Tri-Continental Corporation to exclude from its 2003 proxy soliciting materials a shareholder proposal and supporting statement submitted by Robert G. Wilson by letter dated December 7, 2002. His proposal states:

The Tri-Continental stockholders hereby authorize the Tri-Continental management team to sell "short" any stock it owns, if it anticipates a fall in the stock's market price.

You requested our assurance that we would not recommend enforcement action to the Commission if Tri-Continental excludes the proposal in reliance upon subparagraphs (i)(7) and (10) of Rule 14a-8 under the Securities Exchange Act of 1934.

Subparagraph (i)(10) of Rule 14a-8 provides that a company may exclude a proposal if the proposal has been "substantially implemented."

You argue that management of Tri-Continental is already authorized to make short sales because no fundamental or non-fundamental policy prohibits short sales, and the prospectus clearly discloses that management reserves freedom of action to invest within the limits set by Tri-Continental's fundamental policies.

There appears to be some basis for your view that the proposal may be omitted from Tri-Continental's proxy materials under Rule 14a-8(i)(10). See , e.g. , Brazilian Equity Fund (pub. avail. May 8, 1998) (in order for shareholder proposal to have been "substantially implemented," fund must have actually taken steps to implement the proposal). To this end, we note that the May 1, 2002, Tri-Continental Prospectus specifically discloses that fund assets may be "invested in all types of securities in whatever amounts or proportions J. & W. Seligman & Co. Incorporated (the "Manager") believes best suited to current and anticipated economic and market conditions." Furthermore, Tri-Continental's fundamental policies do not limit its ability to engage in short-selling. Accordingly, we will not recommend enforcement action to the Commission if Tri-Continental excludes the proposal from its proxy materials in reliance on Rule 14a-8(i)(10). In reaching this position, we have not found it necessary to address the alternative bases for omission that you raise in your letter.

Yours very truly,

Linda B. Stirling Senior Counsel Office of Disclosure and Review

cc: Robert G. Wilson

Incoming Letter 1

January 28, 2003

Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20459.

Attention: Chief Counsel, Division of Investment Management

Re:

Tri-Continental Corporation - Intention to Omit Shareholder

Proposal of Mr. Robert P. Laukat and Ms. Rosalind J. Schulman

Ladies and Gentlemen:

In accordance with Rule 14a-8(j) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), we hereby give notice on behalf of Tri-Continental Corporation, a diversified, closed-end management investment company incorporated in Maryland (the "Corporation"), of the Corporation's intention to omit from the proxy statement for its 2003 Annual Meeting of Stockholders (the "Proxy Statement") the stockholder proposal (the "Proposal") and the statement supporting the Proposal (the "Supporting Statement") submitted to the Corporation by Mr. Robert P. Laukat and Ms. Rosalind J. Schulman (together, the "Proponents") under cover of a letter dated October 8, 2002. A copy of the Proposal and Supporting Statement is attached as Annex A. Five additional copies of this letter, including the annexed Proposal and Supporting Statement, are enclosed herewith in accordance with Rule 14a-8(j).

The Proposal

The Proposal proposes that the Corporation's board of directors change the by-laws of the Corporation to require that a majority of its directors not be a director of any other investment company managed by J. & W. Seligman & Co. Incorporated, the Corporation's investment manager (the "Manager"), or otherwise be associated with the Manager. The text of the Proposal, in the form submitted by the Proponents, is as follows:

RESOLVED; that the shareholders of Tri-Continental Corporation assembled in annual meeting in person and by proxy, propose that the Board of Directors change the By-Laws of the Corporation to require that a majority of the Directors not be a Board member of any other Seligman fund or be otherwise associated with J. & W. Seligman and Company.

Request

On behalf of the Corporation, we respectfully request that the staff (the "Staff") of the Securities and Exchange Commission (the "Commission") confirm that it will not recommend any enforcement action if the Corporation omits the Proposal and the Supporting Statement from its Proxy Statement for the reasons set forth below. In the event the Staff disagrees with the Corporation's view that the Proposal may be excluded, the Corporation is of the view that, for the reasons set forth below, various portions of the Supporting Statement are false and misleading and could be excluded by the Corporation in the event that the Proposal is ultimately included in its Proxy Statement.

Grounds for Excluding the Proposal Pursuant to Rule 14a-8

Rule 14a-8(i)(6) - Absence of Power/Authority

Rule 14a-8(i)(6) under the Exchange Act permits the exclusion of a shareholder proposal from a company's proxy materials if the company would lack the power or authority to implement the proposal. Pursuant to Section 2-404 of the Maryland General Corporation Law, the election of directors of a Maryland corporation is exclusively the province of the corporation's stockholders. * Therefore, it is not within the power or authority of the Corporation or its board of directors to guarantee or enforce the election of any particular person or type of person as a director. Accordingly, the Corporation may exclude the Proposal pursuant to Rule 14a-8(i)(6).

The Staff has consistently granted no-action relief pursuant to Rule 14a-8(i)(6) in connection with proposals seeking to require that a Company's board of directors and/or certain committees thereof have a specified minimum number of independent directors. See , e . g ., Farmer Bros. Co. (avail. October 15, 2002) (proposal to amend bylaws to require that a majority of the board of directors be independent and to compose board committees composed entirely of independent directors); General Electric Co. (avail. February 4, 2002) (proposal to increase board independence and require that a majority of directors be independent); Mattel, Inc. (avail. March 21, 2001) (proposal to adopt bylaw requiring that all directors on key board committees meet specified independence criteria); Marriott International, Inc. (avail. February 26, 2001) (proposal that board of directors adopt a policy requiring that at least two-thirds of the members of the board be independent and that certain board committees be composed entirely of independent directors); PG&E Corp. (avail. January 22, 2001) (proposal to adopt bylaw requiring that directors appointed for all future openings on key board committees meet specified independence criteria); and Boeing Co. (avail. February 22, 1999) (proposal that only independent directors be eligible for membership on key board committees).

These no-action letters are consistent with the long-standing line of earlier Staff interpretations recognizing that a board of directors cannot ensure the election of a particular person or type of person and acknowledging that proposals requiring a board to ensure that directors possess certain characteristics are beyond a corporation's powers to implement.

See , e . g ., Ameritech Corp. (avail. December 29, 1994) (proposal to amend by-laws to establish a "Pension Investment Committee" chaired by a director meeting specified criteria excluded pursuant to Rule 14a-8(c)(6)); U.S. West, Inc. (avail. December 22, 1993) (proposal that board of directors ensure that one director's seat be filled by a retired employee of the company who has not been a director or officer of the company excluded pursuant to Rule 14a-8(c)(6)); and American Telephone & Telegraph Co. (avail. December 13, 1985) (proposal that at least one member of the board of directors be an employee-shareholder or retired employee of the company excluded pursuant to Rule 14a-8(c)(6)).

The Corporation respectfully submits that the Proposal is substantially identical to those in the Farmer Bros. , Mattel , and PG&E no-action letters cited above, each of which involved proposals to amend company by-laws to require that directors meet certain specified independence criteria. As in those cases, to implement the Proposal, the Corporation's board of directors would have to ensure or require the election of directors who satisfy the criteria specified by the Proposal. Because the election of directors is a matter which under Maryland law rests exclusively with the stockholders of a corporation, the Proposal relates to a matter beyond the authority of the Corporation's board of directors and may properly be excluded pursuant to Rule 14a-8(i)(6).

Rule 14a-8(i)(8) - Relates to Election of Directors

A proposal may be omitted under Exchange Act Rule 14a-8(i)(8) if it "relates to an election for membership on the company's board of directors or analogous governing body." The Proposal seeks to amend the Corporation's by-laws to require that a majority of the Corporation's board of directors consist of directors meeting the criteria specified by the Proposal. By imposing such criteria, the Proposal would have the effect of disqualifying from service a number of current directors who do not satisfy the specified criteria and would make director nominees standing for election ineligible if their election would result in a majority of the directors not meeting the criteria specified in the Proposal.

The Staff has consistently taken the position that proposals setting forth qualifications for directors which would either disqualify previously elected directors from completing their terms or disqualify nominees at the upcoming annual meeting may properly be omitted from a proxy statement pursuant to Rule 14a-8(i)(8) or its predecessor rule, Rule 14a-8(c)(8). See , e . g ., Conseco, Inc. (avail. April 5, 2002); AT&T Corp. (avail. February 13, 2001); Raytheon Co. (avail. March 9, 1999); Acme United Corp. (avail. February 12, 1996); General Dynamics Corp. (avail. February 5, 1996); Orbit International Corp. (avail. January 5, 1995); Mobil Corp. (avail. February 7, 1994); Louisiana-Pacific Corp (avail. February 18, 1993); Wang Laboratories Inc. (avail. August 14, 1992); General Dynamics Corp. (avail. March 25, 1992); Waste Management, Inc. (avail. March 8, 1991); and Dillard Department Stores, Inc. (avail. March 7, 1991).

The Corporation's board of directors is divided into three equal classes each consisting of four members, with the term of one class expiring each year. Currently, each director is either an officer of the Manager or a director or trustee of investment company affiliates of the Manager, and therefore no director meets the criteria specified by the Proposal for a majority of the Directors. If implemented, the Proposal would serve to disqualify a number of the Corporation's previously elected directors from completing their terms and/or disqualify some or all of the expected nominees at the upcoming annual meeting. Accordingly, the Proposal may properly be excluded by the Corporation pursuant to Rule 14a-8(i)(8).

False and Misleading Statements in the Supporting Statement

Rule 14a-9 prohibits the inclusion within proxy materials of statements that are false or misleading and the omission from proxy materials of material facts necessary to make statements made therein not false or misleading. Rule 14a-8(i)(3) under the Exchange Act permits the omission from a proxy statement of a proposal or supporting statement which violates any of the Commission's proxy rules, including Rule 14a-9. The Staff has indicated that a proposal or supporting statement that contains material inaccuracies and omissions, or that is otherwise vague, indefinite or incomprehensible, may be excluded pursuant to Rule 14a-8(i)(3). See , e . g ., Archer-Daniel-Midland Co. (avail. July 10, 1998); The New Germany Fund, Inc. (avail. May 8, 1998); The Spain Fund, Inc. (avail. May 8, 1998); Ford Motor Co. (avail. February 26, 1980).

If the Staff disagrees with the Corporation's view that the Proposal may be omitted in its entirety pursuant to Rule 14a-8(i)(6) or Rule 14a-8(i)(8), the Corporation submits, for the reasons set forth below, the Supporting Statement contains a number of material misstatements described below which warrant exclusion pursuant to Rule 14a-8(i)(3).

The first paragraph of the Supporting Statement incorrectly cites stock performance data from Barron's, stating that "[o]n October 7, 2002 Barrons reported that we the shareholders lost 3.7% annually from the worth of our investment over the past five years." In fact, the October 7, 2002 issue of Barron's reported the five year annualized market return on Tri-Continental stock for the five-year period ended September 30, 2002 to be -3.4%.

The first paragraph of the Supporting Statement concludes by stating that "Tri-Continental was paid approximately $100 million for this performance, which is a bit less than one-third of the annual dividend and interest income of the fund for that period." In fact, Tri-Continental was not paid for its performance. Rather, Tri-Continental's total expenses for this period were approximately $102.3 million, or 29.6% of total dividend and interest income over the same period. Of this amount, the Manager received aggregate management fees of approximately $70.3 million, representing an even smaller percentage of annual dividend and interest income of approximately 20.4%. More fundamentally, the Corporation believes that it is misleading to express either of the Corporation's expenses or the Manager's fee as a percentage of investment income. Tri-Continental seeks growth of capital as well as reasonable current income, so it is misleading to suggest that the percentage of total income accounted for by such expenses or fees is relevant to an evaluation of the Corporation's or the Manager's performance.

The second paragraph of the Supporting Statement, which discusses the outcome of the shareholder vote on the shareholder proposal included in the Corporation's 2002 proxy statement, incorrectly states that "about 24.1% of the total votes were cast in favor." The Proponents incorrectly failed to include the votes that were withheld or abstained from the denominator in calculating the percentage. Based on the report of the Corporation's proxy tabulator, only 22.4% of votes were cast in favor of the 2002 shareholder proposal.

The third paragraph of the Supporting Statement states that the loyalties of the Corporation's directors "are subordinated to their serving the entire family of Seligman funds." The Corporation respectfully submits that each of its directors is well aware that he or she owes, and that each strives to fulfill, the same fiduciary duties to each of the Seligman investment companies on whose board he or she sits. Moreover, the pursuit by such companies of different investment strategies does not require, either in theory or in practice, that such directors "subordinate" their duties to one or more such entities in favor of any others. The Corporation believes that the quoted assertion impugning the integrity of its directors (for which no support whatsoever is provided) is highly inflammatory and is excludible pursuant to Rule 14a-8(i)(3) because it is materially false and misleading.

Finally, the Corporation notes that certain statements in the second and fifth paragraphs of the Supporting Statement, in which the Proponents assert that shareholders would be better served "if Tri-Continental were structured as an index fund" and that "all staff should work only for Tri-Continental" would, if included as part of the Proposal, be excludable pursuant to the eligibility criteria specified under Rule 14a-8(c), which provides that a shareholder may submit no more than one proposal to a company for a particular shareholder's meeting. Although the Proponents do not purport to include these proposals within their Proposal, the Corporation respectfully submits that these statements are not relevant to a statement in support of the Proposal and are included merely for the purposes of advocating unrelated proposals to shareholders in a manner designed to circumvent the requirements of Rule 14a-8.

In light of the several material misstatements in the Supporting Statement described above, the Corporation submits that the portions thereof discussed in the five preceding paragraphs may be excluded from the Proxy Statement pursuant to Rule 14a-8(i)(3).

In accordance with Rule 14a-8(j), the Corporation is contemporaneously notifying the Proponents, by copy of this letter including Annex A, of its intention to omit the Proposal and Supporting Statement from its Proxy Materials.

The Corporation does not expect to file its definitive Proxy Materials with the Commission until on or about April 21, 2003. The Corporation anticipates that the printing of its definitive Proxy Materials will begin shortly thereafter.

On behalf of the Corporation, we hereby respectfully request that the Staff express their intention not to recommend enforcement action if the Proposal and Supporting Statement are excluded from the Corporation's Proxy Materials for the reasons set forth above. If the Staff disagrees with the Corporation's conclusions regarding the omission of the Proposal and Supporting Statement, or if any additional submissions are desired in support of the Corporation's position, we would appreciate an opportunity to meet with the Staff or to speak with the Staff by telephone prior to the issuance of the Rule 14a-8(j) response. If you have any questions regarding this request, or need any additional information, please telephone the undersigned at (212) 558-4016 or Sven O. Milelli of this office at (212) 558-4607.

Please acknowledge receipt of this letter and the enclosed materials by stamping the enclosed copy of the letter and returning it to our messenger, who has been asked to wait.

Very truly yours,

Donald R. Crawshaw

(Enclosures)

cc: Robert P. Laukat Rosalind J. Schulman

Frank J. Nasta, Esq. (Tri-Continental Corporation)

Section 2-404(b)(1) of the Maryland General Corporation Law provides, in relevant part, that "at each annual meeting of stockholders, the stockholders shall elect directors to hold office..."

Incoming Letter 2

February 14, 2003

Ms. Linda B. Stirling, Senior Counsel, Division of Investment Management, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20459.

Re:

Tri-Continental Corporation - Intention to Omit Second Shareholder Proposal Submitted by

Mr. Robert P. Laukat and Ms. Rosalind J. Schulman

Dear Ms. Stirling:

In accordance with Rule 14a-8(j) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), we hereby give notice on behalf of Tri-Continental Corporation, a diversified, closed-end management investment company incorporated in Maryland (the "Corporation"), of the Corporation's intention to omit from the proxy statement for its 2003 Annual Meeting of Stockholders (the "Proxy Statement") the stockholder proposal (the "Second Proposal") and the statement supporting the Proposal (the "Second Supporting Statement") submitted to the Corporation by Mr. Robert P. Laukat and Ms. Rosalind J. Schulman (together, the "Proponents") under cover of a letter dated February 5, 2003. A copy of the Second Proposal and Second Supporting Statement is attached as Annex A. Five additional copies of this letter, including Annex A, are enclosed herewith in accordance with Rule 14a-8(j).

We note that the Second Proposal has been submitted by the Proponents in response to our letter to the staff (the "Staff") of the Securities and Exchange Commission (the "Commission"), dated January 28, 2003 (the "First Request"), seeking confirmation that the Staff would not recommend enforcement action if the Corporation excludes from the Proxy Statement the proposal submitted by the Proponents under cover of a letter dated October 8, 2002 (the "First Proposal"). The text of the Second Proposal, in the form submitted by the Proponents, is as follows:

By contrast, the text of the First Proposal, in the form submitted by the Proponents, is as follows:

RESOLVED, that the shareholders of Tri-Continental Corporation assembled in annual meeting in person and by proxy, propose that the Board of Directors change the By-Laws of the Corporation to require that a majority of the Directors not be a Board member of any other Seligman fund or be otherwise associated with J. & W. Seligman and Company.

The Corporation respectfully submits that the Second Proposal and Second Supporting Statement contain such significant and substantive additions, deletions and modifications to the First Proposal and related supporting statement (the "First Supporting Statement") that the Second Proposal is actually a different and new proposal and may properly be excluded pursuant to both Rule 14a-8(c), which provides that a shareholder may submit no more than one proposal to a company for a particular shareholders' meeting, and Rule 14a-8(e), which provides that a proposal submitted after the applicable deadline - which, in the case of the Corporation, was December 20, 2002 - may be excluded.

Set forth below is a list of the principal differences between the First Proposal and the Second Proposal, and between the First Supporting Statement and the Second Supporting Statement.

Differences Between the First Proposal and the Second Proposal

The Corporation notes the following material differences between the First Proposal and the Second Proposal:

The by-law amendments proposed by the First Proposal and the Second Proposal would apply substantially different criteria to the Corporation's board of directors: the First Proposal would require that a majority of its directors not be a director of any other investment company managed by J. & W. Seligman & Co. Incorporated, the Corporation's investment manager (the "Manager"), or otherwise be associated with the Manager, whereas the Second Proposal would require that a majority of its directors not be affiliated with the Manager.

The proposed by-law amendment under the First Proposal would require that the board of directors meet the specified criteria immediately following enactment of the by-law amendment, whereas the Second Proposal would require the board of directors to meet the specified criteria "at the earliest practicable time" following enactment.

The Second Proposal goes on to propose that the by-law requirement be satisfied by nominating persons who meet the specified criteria at succeeding annual meetings. The First Proposal does not contain any such proposal.

Difference Between the First Supporting Statement and the Second Supporting Statement

The Corporation notes the following differences between the First Supporting Statement and the Second Supporting Statement:

The third sentence of the first paragraph of the First Supporting Statement does not appear in the Second Supporting Statement.

The third and fifth paragraphs of the First Supporting Statement do not appear in the Second Supporting Statement.

The second paragraph of the Second Supporting Statement is entirely new.

In addition to the changes described above, many of the statements which appear in both the First Supporting Statement and the Second Supporting Statement have been rearranged so as to change the overall structure of the First Supporting Statement.

The Corporation respectfully submits that, taken together, the differences between the First Proposal and the Second Proposal and between the First Supporting Statement and the Second Supporting Statement go substantially beyond what the Staff contemplated in Staff Legal Bulleting No. 14 where it described its longstanding practice of permitting shareholders to make "revisions that are minor in nature and do not alter the substance of the proposal."

Based on the foregoing, the Corporation believes that the Second Proposal may properly be regarded as a new and different proposal and may be excluded pursuant to Rule 14a-8(c) and Rule 14a-8(e). In addition, the Corporation notes that, as in the case of the First Supporting Statement, the Second Supporting Statement contains several false and misleading statements that the Corporation would normally seek to exclude pursuant to Rule 14a-8(i)(3).

On behalf of the Corporation, we respectfully request that the Staff confirm that it will not recommend any enforcement action if the Corporation omits the Second Proposal and the Second Supporting Statement from its Proxy Statement pursuant to Rule 14a-8(c) and Rule 14a-8(e).

In the event that the Staff disagrees with the Corporation's view that the Second Proposal constitutes a new proposal, and instead regards the Second Proposal and Second Supporting Statement as constituting revisions to the First Proposal and First Supporting Statement, please be advised that the Corporation has elected not to address the revisions proposed by the Proponents and hereby reaffirms its request that the Staff confirm that it will not recommend any enforcement action if the Corporation omits the First Proposal and First Supporting Statement from the Proxy Statement for the reasons set forth in the First Request. *

The Corporation notes in this regard that Staff Legal Bulletin No. 14 specifies that where a shareholder makes revisions to his or her proposal after the company has submitted its no-action request, the company may, but is not required to, address the shareholder's revisions and the Staff will base its response on the proposal contained in the company's original no-action request unless the company acknowledges and accepts the shareholder's changes in which case the Staff will base its response on the revised proposal.

In accordance with Rule 14a-8(j), the Corporation is contemporaneously notifying the Proponents, by copy of this letter including Annex A, of its intention to omit the Second Proposal and Second Supporting Statement from its Proxy Materials.

On behalf of the Corporation, we hereby respectfully request that you confirm that the Staff will not recommend enforcement action if the Second Proposal and Second Supporting Statement are excluded from the Corporation's Proxy Materials for the reasons set forth above. If you disagree with the Corporation's conclusions regarding the omission of the Second Proposal and Second Supporting Statement, or if any additional submissions are desired in support of the Corporation's position, we would appreciate an opportunity to speak with you by telephone prior to the issuance of the Rule 14a-8(j) response. If you have any questions regarding this request, or need any additional information, please telephone Sven O. Milelli of this office at (212) 558-4607 or the undersigned at (212) 558-4016.

Please acknowledge receipt of this letter and the enclosed materials by stamping the enclosed copy of the letter and returning it to our messenger, who has been asked to wait.

Very truly yours,

Donald R. Crawshaw

(Enclosures)

cc: Robert P. Laukat Rosalind J. Schulman

Frank J. Nasta, Esq. (Tri-Continental Corporation)

The Corporation notes that certain of the statements in the Second Supporting Statement suggest that the Proponents would be agreeable to amending certain of the false and misleading statements in the First Supporting Statement identified in the First Request in the event that the Staff does not agree with the Corporation's view that the First Proposal may be excluded in its entirety from the Proxy Statement.

Incoming Letter 3

January 28, 2003

Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20459.

Attention: Chief Counsel, Division of Investment Management

Re:

Tri-Continental Corporation - Intention to Omit

Shareholder Proposal of Ms. Betty Rowe Wilson

Ladies and Gentlemen:

In accordance with Rule 14a-8(j) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), we hereby give notice on behalf of Tri-Continental Corporation, a diversified, closed-end management investment company incorporated in Maryland (the "Corporation"), of the Corporation's intention to omit from the proxy statement for its 2003 Annual Meeting of Stockholders (the "Proxy Statement") the stockholder proposal (the "Proposal") and the statement supporting the Proposal (the "Supporting Statement") received by the Corporation from Ms. Betty Rowe Wilson (the "Proponent") during the week of December 16, 2002. A copy of the Proposal and Supporting Statement is attached as Annex A. Five additional copies of this letter, including the annexed Proposal and Supporting Statement, are enclosed herewith in accordance with Rule 14a-8(j).

The Proposal

The text of the Proposal, in the form submitted by the Proponent, is as follows:

Request

On behalf of the Corporation, we respectfully request that the staff (the "Staff") of the Securities and Exchange Commission (the "Commission") confirm that it will not recommend any enforcement action if the Corporation omits the Proposal and the Supporting Statement from its Proxy Statement for the reasons set forth below. In the event the Staff disagrees with the Corporation's view that the Proposal may be excluded in its entirety, the Corporation is of the view that, for the reasons set forth below, various portions of the Proposal and the Supporting Statement are false and misleading and could be excluded by the Corporation in the event that some form of the Proposal is ultimately included in its Proxy Statement.

Grounds for Excluding the Proposal Pursuant to Rule 14a-8

Rule 14a-8(i)(3) - Vague or Incomprehensible

Rule 14a-9 prohibits the inclusion within proxy materials of statements that are false or misleading and the omission from proxy materials of material facts necessary to make statements made therein not false or misleading. Rule 14a-8(i)(3) under the Exchange Act permits the omission from a proxy statement of a proposal or supporting statement which violates any of the Commission's proxy rules, including Rule 14a-9. The Staff has indicated that a proposal or supporting statement that contains material inaccuracies and omissions, or that is otherwise vague, indefinite or incomprehensible, may be excluded pursuant to Rule 14a-8(i)(3). See , e . g ., Archer-Daniel-Midland Co. (pub. avail. July 10, 1998) (hereinafter, " ADM Letter "); The New Germany Fund, Inc. (pub. avail. May 8, 1998); The Spain Fund, Inc. (pub. avail. May 8, 1998); Ford Motor Co. (pub. avail. February 26, 1980). The Corporation respectfully submits that the Proposal is excludible pursuant to Rule 14a-8(i)(3) since, as discussed below, it contains both a number of material inaccuracies and omissions, and is vague, indefinite and incomprehensible.

The Corporation believes that the Proponent likely intended to propose that the Corporation cease purchasing shares under its share repurchase program. However, the Proposal is so confusingly worded that it is not clear what is actually being proposed. The first sentence inaccurately states that the Corporation is a mutual fund. The second sentence materially misstates the facts by asserting that the Corporation has become "open-ended," which is clearly not the case. This assertion is immediately followed by a confusing mischaracterization of what makes a fund open- or closed-ended. The fourth sentence, which properly belongs in the Supporting Statement as an argument in support of the Proposal, again materially mischaracterizes the status of the Corporation, asserting that it has shifted from closed-ended to open-ended and back again. The Corporation believes that, by confusingly and inappropriately conflating the concept of share repurchases with the status of an investment company as open- or closed-ended, and by its failure to make a comprehensible proposal, the Proposal misleads the reader as to the subject and effect of the Proposal. In addition, the Supporting Statement does nothing to clarify the Proposal's meaning. Reference is made to the discussion below under the heading "False and Misleading Statements in the Supporting Statement." The Corporation respectfully submits that, as a result of the foregoing, the Proposal is so unclear, misleading and confusing that it may properly be excluded in its entirety pursuant to Rule 14a-8(i)(3).

Rule 14a-8(i)(1) - Inappropriate for Action by Shareholders

Rule 14a-8(i)(1) states that a stockholder proposal may be omitted from a company's proxy statement if "the proposal is not a proper subject for action by shareholders under the laws of the jurisdiction of the company's organization." The Corporation is incorporated under the laws of the State of Maryland. Section 2-401 of the Maryland General Corporation Law (the "MGCL"), states:

(a) Management. - The business and affairs of a corporation shall be managed under the direction of a board of directors.

(b) Power of board. - All powers of the corporation may be exercised by or under authority of the board of directors except as conferred on or reserved to the stockholders by law or by the charter or bylaws of the corporation.

There is no provision in the MGCL or in the Corporation's Charter or Bylaws granting stockholders the power to generally direct the day-to-day investment policies of the Corporation. The Corporation's 2002 Statement of Additional Information does disclose certain fundamental investment policies which may only be modified with shareholder consent. However, none of these policies relates to the repurchase of the Corporation's shares. The Corporation's 2002 Prospectus states that, with the exception of those fundamental policies requiring the consent of shareholders to modify, management has reserved freedom of action with respect to the general investment policies. Thus, in directing the Corporation to take the actions specified in the Proposal (rather than merely requesting or recommending that the Board of Directors consider such actions), the Proposal constitutes an unlawful intrusion into the authority of the Board of Directors contrary to Section 2-401 of the MGCL and may be omitted from the Corporation's Proxy Materials under Rule 14a-8(i)(1). A number of the Staff's recent no-action letters support this position. See , e.g. , ADM Letter (proposal demanding certain inaction by the board of directors of the company could be omitted under Rule 14a-8(i)(1) unless recast as a recommendation or request within seven days after receipt by the proponent of the Staff's letter); RJR Nabisco Holding Corp. (pub. avail. February 23, 1998) (proposal requiring mandatory action by the board of directors of the company could be omitted under what is today Rule 14a-8(i)(1) unless recast as a recommendation or request within seven days after receipt by the proponent of the Staff's letter); and Dow Jones & Company, Inc. (pub. avail. November 30, 1995) (proposal demanding certain action by the board of directors of the company could be omitted under what is today Rule 14a-8(i)(1) unless recast as a recommendation or request within seven days after receipt by the proponent of the Staff's letter).

False and Misleading Statements in the Supporting Statement

If the Staff disagrees with the Corporation's position that the Proposal may be omitted in its entirety pursuant to Rule 14a-8(i)(3) or Rule 14a-8(i)(1), the Corporation submits that, for the reasons set forth below, the Supporting Statement is so replete with material misstatements or otherwise vague, indefinite or incomprehensible that it should be excluded in its entirety pursuant to Rule 14a-8(i)(3). If the Staff disagrees that it should be excluded in its entirety, the Corporation submits that the Supporting Statement contains a number of material misstatements described below which warrant exclusion pursuant to Rule 14a-8(i)(3). Reference is also made to the discussion of Rule 14a-8(i)(3) above under the heading "Rule 14a-8(i)(3) - Vague or Incomprehensible."

In the fourth sentence of the Supporting Statement, the Proponent materially misstates the objective and result of a share repurchase program. The Proponent states that "[i]n recent years, a significant best place' was to invest our money in our own stock, through repurchases on the open market." This statement inaccurately implies that the Corporation repurchases shares to hold as an investment in its portfolio. Under Maryland law, shares repurchased by a corporation are cancelled and not held in treasury. Accordingly, though the repurchase of shares requires an allocation of the Corporation's capital, shares repurchased are not held as an investment. In addition, the Proponent indicates that the Corporation's repurchase of shares is significant.' The Proponent does not indicate what constitutes significant in this context, nor does she provide a citation or illustration that might allow a shareholder to determine whether or not the Corporation's share repurchasing was, in fact, objectively or subjectively `significant.'

In the fifth sentence of the Supporting Statement, the Proponent offers net asset value and market price figures without reference to the relevant date or citation to the source of the figures. The sixth sentence then offers a second set of net asset value and market price figures, which the Corporation believes to be the closing figures for December 6, 2002, again without reference to the relevant date or citation to the source. Because neither set of figures cites a reference date, the time interval between the two sets of figures is impossible to determine. As a result, shareholders may be given the misleading impression that the interval spans any number of years.

In the seventh and eighth sentences of the Supporting Statement, the Proponent states without citation that the Corporation was "buying all the way, as market price fell from 30 down to 14," and that shareholders "lost on those re-purchases." The Corporation believes that the Proponent is making assertions that are materially false and misleading to shareholders, and that cannot be supported by data. Again, the Proponent seems to be making statements under the misapprehension that the share repurchase program is an investment alternative. In fact, the Corporation only purchases its own stock when it is trading at a discount of over 10% so that each and every repurchase results in a significant anti-dilutive benefit to shareholders.

In sentences nine through sixteen of the Supporting Statement, the Proponent makes several statements of opinion that are presented as statements of fact. Without a clear indication that such statements reflect only the Proponent's opinion, the statements may be misleading to shareholders who interpret them to be statements of fact.

In light of the fact that the Supporting Statement is replete with material misstatements as described above, as well as its overall vague, indefinite or incomprehensible character, the Corporation submits that the Supporting Statement may be excluded in its entirety or, in the alternative, that the portions thereof discussed in the preceding four paragraphs may be excluded from the Proxy Statement, in each case pursuant to Rule 14a-8(i)(3).

Please acknowledge receipt of this letter and the enclosed materials by stamping the enclosed copy of the letter and returning it to our messenger, who has been asked to wait.

Very truly yours,

Donald R. Crawshaw

(Enclosures)

cc: Rosalind J. Schulman

Frank J. Nasta, Esq. (Tri-Continental Corporation)

Incoming Letter 4

February 20, 2003

Ms. Linda B. Stirling, Senior Counsel, Division of Investment Management, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20459.

Re:

Tri-Continental Corporation - Intention to Omit

Second Shareholder Proposal of Ms. Betty Rowe Wilson

Dear Ms. Stirling:

In accordance with Rule 14a-8(j) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), we hereby give notice on behalf of Tri-Continental Corporation, a diversified, closed-end management investment company incorporated in Maryland (the "Corporation"), of the Corporation's intention to omit from the proxy statement for its 2003 Annual Meeting of Stockholders (the "Proxy Statement") the stockholder proposal (the "Second Proposal") and the statement supporting the Second Proposal (the "Second Supporting Statement") received by the Corporation on February 13, 2003 from Ms. Betty Rowe Wilson (the "Proponent") under cover of a letter dated February 7, 2003 (the "Cover Letter"). Copies of the Cover Letter and the Second Proposal and the Second Supporting Statement are attached as Annexes A and B, respectively. Five additional copies of this letter, including Annexes A and B, are enclosed herewith in accordance with Rule 14a-8(j).

We note that it appears that the Second Proposal has been submitted by the Proponent in response to our letter to the staff (the "Staff") of the Securities and Exchange Commission (the "Commission"), dated January 28, 2003 (the "First Request"), seeking confirmation that the Staff would not recommend enforcement action if the Corporation excludes from the Proxy Statement the proposal received by the Corporation from the Proponent during the week of December 16, 2002 (the "First Proposal"). The Proponent states in the Cover Letter that she is withdrawing the First Proposal and replacing it with the Second Proposal.

The Corporation notes that, except for its new lead-in sentence, the Second Proposal is virtually identical to the First Proposal, while the Second Supporting Statement differs substantially from the supporting statement to the First Proposal (the "First Supporting Statement"). The text of the Second Proposal, in the form submitted by the Proponent, is as follows:

Tri-Continental Corporation defines itself as a diversified, closed-end management investment company incorporated in the State of Maryland. "Barron's Financial Weekly" publication classifies it as a "closed-end mutual fund". In recent years, it has become "open-ended", in the sense that it has been buying its own stock, both from Stockholders and in the open market. I propose an end to this activity. Please vote in favor of this proposal, if you agree the corporation should return to a true "closed-end" status.

The text of the First Proposal, in the form submitted by the Proponent, is as follows:

The Corporation respectfully submits that, if the Proponent's request is taken literally, it would have the effect of permitting the Corporation to exclude both the First Proposal, which the Proponent has explicitly withdrawn, as well as the Second Proposal, which has been submitted well after the Corporation's deadline for shareholder proposals and is therefore excludable pursuant to Rule 14a-8(e) as discussed further below. In light of the fact that the Second Proposal is substantially identical to the First Proposal, the Corporation has instead assumed that the Proponent's true intention, notwithstanding the third sentence of the Cover Letter, is to revise the First Proposal and the First Supporting Statement.

Please be advised that the Corporation has elected not to address the revisions proposed by the Proponent and hereby reaffirms its request that the Staff confirm that it will not recommend any enforcement action if the Corporation omits the First Proposal and First Supporting Statement from the Proxy Statement for the reasons set forth in the First Request.

In the event that the Staff disagrees with the Corporation's view that the Second Proposal constitutes a revision to the First Proposal, and instead regards the Second Proposal as a new proposal, the Corporation will regard the First Proposal as having been withdrawn by the Proponent in accordance with the Cover Letter, and respectfully submits that the Second Proposal may properly be excluded pursuant to Rule 14a-8(e), which provides that a proposal submitted after the applicable deadline - which, in the case of the Corporation, was December 20, 2002 - may be excluded. *

In accordance with Rule 14a-8(j), the Corporation is contemporaneously notifying the Proponent, by copy of this letter including Annexes A and B, of its intention to omit the Second Proposal and the Second Supporting Statement from its Proxy Statement.

The Corporation does not expect to file its definitive Proxy Statement with the Commission until on or about April 21, 2003. The Corporation anticipates that the printing of its definitive Proxy Statement will begin shortly thereafter.

On behalf of the Corporation, we hereby respectfully request that the Staff confirm that it will not recommend enforcement action if the Second Proposal and Second Supporting Statement are excluded from the Corporation's Proxy Statement for the reasons set forth above. If you disagree with the Corporation's conclusions regarding the omission of the Second Proposal and the Second Supporting Statement, or if any additional submissions are desired in support of the Corporation's position, we would appreciate an opportunity to speak with you by telephone prior to the issuance of the Rule 14a-8(j) response. If you have any questions regarding this request, or need any additional information, please telephone Sven O. Milelli of this office at (212) 558-4607 or the undersigned at (212) 558-4016.

Please acknowledge receipt of this letter and the enclosed materials by stamping the enclosed copy of the letter and returning it to our messenger, who has been asked to wait.

Very truly yours,

Donald R. Crawshaw

(Enclosures)

cc: Rosalind J. Schulman

Frank J. Nasta, Esq. (Tri-Continental Corporation)

The Corporation also notes that, even if it were timely, the Second Proposal would fail to satisfy Rule 14a-8(f), which provides that a proposal, including any accompanying supporting statement, may not exceed 500 words (the Second Proposal and the Second Supporting Statement together exceed 550 words).

Incoming Letter 5

January 28, 2003

Securities and Exchange Commission 450 Fifth Street, N.W., Washington, D.C. 20459.

Attention: Chief Counsel, Division of Investment Management

Re:

Tri-Continental Corporation - Intention to Omit

Shareholder Proposal of Mr. Robert G. Wilson

Ladies and Gentlemen:

In accordance with Rule 14a-8(j) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), we hereby give notice on behalf of Tri-Continental Corporation, a diversified, closed-end management investment company incorporated in Maryland (the "Corporation"), of the Corporation's intention to omit from the proxy statement for its 2003 Annual Meeting of Stockholders (the "Proxy Statement") the stockholder proposal (the "Proposal") and the statement supporting the Proposal (the "Supporting Statement") submitted to the Corporation by Mr. Robert G. Wilson (the "Proponent") under cover of a letter dated December 7, 2002. A copy of the Proposal and Supporting Statement is attached as Annex A. Five additional copies of this letter, including the annexed Proposal and Supporting Statement, are enclosed herewith in accordance with Rule 14a-8(j).

The Proposal

The Proposal proposes that the shareholders authorize the Corporation to engage in short sales of any stock it owns. The text of the Proposal, in the form submitted by the Proponent, is as follows:

The Tri-Continental stockholders hereby authorize the Tri-Continental management team to sell "short" any stock it owns, if it anticipates a fall in the stock's market price.

Request

Grounds for Excluding the Proposal Pursuant to Rule 14a-8

Rule 14a-8(i)(10) - Substantially Implemented

The Corporation believes that it may exclude the Proposal pursuant to Exchange Act Rule 14a-8(i)(10), which permits the exclusion of a shareholder proposal from a company's proxy materials where the proposal has been rendered moot. To be rendered moot a proposal must have been "substantially implemented by the issuer," but need not have been "fully effected." See Exchange Act Release No. 20091 (Aug. 16, 1983). The Staff has indicated that, in order for a proposal to have been "substantially implemented," the company must have actually taken steps to implement the proposal. See , e.g. , Brazilian Equity Fund, Inc. (pub. avail. May 8, 1998); The Growth Fund of Spain, Inc. (pub. avail. May 8, 1998); The Emerging Mexico Fund, Inc. (pub. avail. May 8, 1998).

The Proponent proposes that the stockholders authorize the Corporation's management to engage in covered short-sales. The Corporation respectfully submits that, as described below, management is already authorized to engage in such transactions, thereby rendering the Proposal moot. The Corporation, which has operated since 1929, has very broad authority with respect to its operations. None of its fundamental or non-fundamental policies in any way limits its ability to engage in short selling. Moreover, in its most recent prospectus, the Corporation explicitly reserves to its management freedom of action to invest within the limits of its fundamental policies. In other words, the Corporation's management, subject to the ultimate control of the Board of Directors, is broadly authorized to take any actions in connection with the management of the Corporation that it deems fit unless explicitly prohibited from doing so. The Corporation's management has not been precluded from causing the Corporation to engage in short sales, and management is therefore fully authorized to cause the Corporation to make short sales. The fact that the Corporation has not chosen to engage in short sales in the past has no bearing on the issue of whether the proponent's proposal has been "substantially implemented" - the proposal purports to "authorize" what in fact is already clearly authorized and therefore may properly be excluded pursuant to Rule 14a-8(i)(10).

Rule 14a-8(i)(7) - Management Functions

Rule 14a-8(i)(7) under the Exchange Act permits the exclusion of a shareholder proposal from a company's proxy materials if it deals with a matter relating to the Corporation's ordinary business operations. The Staff has indicated that Rule 14a-8(i)(7) permits the exclusion of proposals that are "mundane in nature and do not involve any substantial policy or other considerations." See Exchange Act Release No. 12999 (Nov. 22, 1976). By contrast, the Staff has stated that proposals deemed to have major implications will be considered "beyond the realm of an issuer's ordinary business operations" and, thus, should not be excluded from a company's proxy materials under Rule 14a-8(i)(7). See

Tri-Continental Corporation (pub. avail. Mar. 11, 1997) (hereinafter, " Tri-Continental Letter "). More recently, the Staff has described the policy underlying the "ordinary business" exclusion as resting on two principal considerations: (1) whether the subject matter of the proposal relates to tasks that "are so fundamental to management's ability to run a company on a day-to-day basis that they could not, as a practical matter, be subject to direct shareholder oversight," and (2) "the degree to which the proposal seeks to "micro-manage" the company by probing too deeply into matters of a complex nature upon which shareholders, as a group, would not be in a position to make an informed judgment." See Exchange Act Release No. 40018 (May 21, 1998). The Corporation respectfully submits that it would be very difficult to imagine anything more fundamental to management of the Corporation than the selling and purchasing of securities. Likewise, to the extent it seeks to influence the sale of securities from the Corporation's portfolio, one would be hard pressed to find a better example of an attempt to micro-manage the Corporation than the Proposal.

In the context of an investment company, the test for exclusion pursuant to Rule 14a-8(i)(7) is one of facts and circumstance. See

Cargill Financial Markets Plc (pub. avail. Mar. 15, 1996) (hereinafter, " Cargill Letter "). In applying Rule 14a-8(i)(7) to investment companies, the Staff has indicated that the purchase and sale of securities intended to advance stated investment objectives and performance goals falls within the ordinary business operations of an investment company. See

Cargill Letter ; Morgan Stanley Africa Investment Fund (pub. avail. April 26, 1996) (hereinafter, " Morgan Stanley Africa Letter "); The Germany Fund, Inc. (pub. avail. April 25, 1991) (hereinafter, " Germany Letter "). In contrast, changes in the company's basic capital structure, which are regulated by the Investment Company Act of 1940, as amended (the "1940 Act"), fall outside the ordinary business operations of an investment company. See

Cargill Letter ; Morgan Stanley Africa Letter ; Germany Letter . The Proposal clearly relates to the sale and purchase of securities to advance the stated investment objective of the Corporation.

Selling a security short is a long-established investment technique that simply reverses the chronology of purchase and sale in order to realize a short-term gain from a diminishing stock price. The 1940 Act authorizes the Securities and Exchange Commission (the "Commission") to regulate short sales by investment companies "as necessary or appropriate in the public interest or for the protection of investors." See 1940 Act § 12(a)(3). However, although the Staff has provided certain guidance concerning short sales, the Commission has not prescribed rules, regulations or orders pursuant to the 1940 Act prohibiting or regulating the short-sale of any security by an investment company. Numerous investment companies utilize short selling in pursuit of their investment objectives, some have fundamental or non-fundamental policies precluding short sales, while others, including the Corporation, choose not to engage in such transactions while retaining the ability to do so should they determine such action to be in their interests. For Rule 14a-8(i)(7) purposes, a short sale must be regarded as the sale and purchase of a security falling within the ordinary operations of an investment company, as contemplated by Cargill

Letter , Morgan Stanley Africa Letter , and Germany Letter . The discretionary decision to buy and sell securities, including through covered short sales, is so fundamental to the Corporation's ability to run its business on a day-to-day basis that it cannot be the subject of shareholder oversight. The Proponent implicitly recognizes this in his Supporting Statement, where he notes that shareholders "must count on management to be cognizant of the market, and to make proper decisions just as it does when it buys a stock "long" and holds it in anticipation of a rise in it's (sic) market price." Proponent's proposal that management sell a security short if it anticipates a fall in the stock's market price attempts to micro-manage management's use of its investment discretion and may properly be regarded as probing too deeply into matters of a complex nature upon which shareholders, as a group, are not be in a position to make an informed judgment. Accordingly, the Corporation respectfully submits that the Proposal may properly be excluded pursuant to Rule 14a-8(i)(7).

Please acknowledge receipt of this letter and the enclosed materials by stamping the enclosed copy of the letter and returning it to our messenger, who has been asked to wait.

Very truly yours,

Donald R. Crawshaw

(Enclosures)

cc: Robert G. Wilson

Frank J. Nasta, Esq. (Tri-Continental Corporation)

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